NEW YORK — Mixed earnings reports pushed down retail stocks last week.
The WWD Composite Stock Index closed the week off 0.6 percent, at 1,141.65, from 1,148.29 the previous week. The broader S&P 500 added 0.8 percent to close at 1,211.37.
Among earnings news last week, Kenneth Cole Productions Inc. on Thursday posted an 8.6 percent decline in fourth-quarter earnings. The results matched Wall Street’s consensus and company executives gave investors something to cheer about. They provided first-quarter and full-year profit guidance that could beat analysts’ estimates. Investors sent shares of the company up 5.8 percent, closing the week at $29.09 in New York Stock Exchange trading.
In the quarter ended Dec. 31, Kenneth Cole earned $9.3 million, or 45 cents a diluted share, compared with $10.1 million, or 49 cents, a year ago. Total revenues rose 5.3 percent to $136.1 million from $129.2 million. Earnings for 2004 increased 10 percent to $35.9 million, or $1.74, versus $32.6 million, or $1.59, in 2003. Total revenues for the year rose 10.2 percent to $516.2 million.
Kenneth Cole anticipates a first-quarter profit of 36 to 38 cents on revenues of $128 million to $132 million. Analysts’ consensus estimates are for earnings per share of 37 cents on revenues of $122 million. For 2005, the company forecast earnings of $1.94 to $2 on revenues of $550 million to $575 million. The consensus estimate is for a profit of $1.99 on $559 million in revenues.
As talks between Federated Department Stores and May Department Stores Co. gained steam, shares of the two chains took divergent paths. Federated ended the week down 0.4 percent to close at $56.79, while May shares gained 4.4 percent to close at $35.35. Both trade on the Big Board.
Meanwhile, same-store sales for February will be reported by most retailers this Wednesday and Thursday. Although many companies are facing difficult sales comparisons over the year-ago period, the start of the spring selling season appears strong, thanks partly to favorable weather trends, said Piper Jaffray senior research analyst Jeffrey Klinefelter.
This story first appeared in the February 28, 2005 issue of WWD. Subscribe Today.
Several “warm spells helped to drive demand for early spring merchandise, including apparel as well as outdoor gear, while a few February snowstorms helped clear out the last of the winter merchandise,” Klinefelter wrote in a Thursday report previewing February’s sales.